Days after Facebook’s parent company Meta called its quits for its stablecoin project Diem, Block Inc’s Jack Dorsey has come lashing out at the company.

The Twitter founder and former executive believe that Facebook’s Mark Zuckerberg should have spent so much effort in creating a new stablecoin. Dorsey believes that the company would have been better off had they focused on improving the Bitcoin ecosystem.

Jack Dorsey is an ardent fan of Bitcoin and has been working on ways to improve the ecosystem. Dorsey’s payment company Block Inc. is working on affordable and easily accessible (less technical) Bitcoin wallets along with creating affordable hardware for Bitcoin miners.

On Tuesday, Feb 1, Dorsey said that Meta’s approach to Diem wasn’t open enough. He further criticizes the company for putting too much focus for driving people to its own suite of products. Speaking at the MicroStrategy World Conference on Tuesday, Dorsey added:

“They tried to create a currency that was owned by Facebook — probably for the right reasons, probably for noble reasons — but there were also some reasons that would indicate trying to get more and more people onto the Facebook ecosystem. They did that instead of using an open protocol and standard like Bitcoin.

Hopefully they learned a lot, but I think there was a lot of wasted effort and time. Those two years or three years, or however long it’s been, could have been spent making Bitcoin more accessible for more people around the world, which would also benefit their Messenger product and Instagram and WhatsApp.”

Silvergate to Acquire Meta’s Diem Assets

As per the recent development, crypto-focused Silvergate bank shall be acquiring Meta’s Diem Assets for a reported bid of around $200 million. This will mark the end of Diem’s three-year efforts that started around June 2019.

Meta’s long-going regulatory discussions didn’t turn out to be in favor of the company! However, the interesting question is whether this will be the end of Meta’s crypto pursuit? Last year Tesla set precedence by adding Bitcoin to its balance sheet.

Currently, Meta is holding massive cash on its balance and many analysts are hopeful that it will be the next big organization to buy Bitcoin. Do you think we can hear a Bitcoin purchase announcement from Meta ahead this year in 2022?

Facebook founder Mark Zuckerberg’s ambitious program to create his own cryptocurrency is falling apart amid rising tension from regulators.

According to a Bloomberg report released Wednesday, the Diem Association, which manages the expansion of the Diem digital currency, is contemplating a sale of its assets to return money to its investors. The report adds Diem is selling its technology to crypto-focused small- California-based bank Silvergate Capital for $200 million.

Facebook, now known as Meta, established its cryptocurrency assignment in 2019 and virtually immediately ran into opposition in Washington. Bloomberg wrote, “One of the people speaking to Bloomberg under the condition of anonymity says that Meta owns about a third of the venture, and the remainder is owned by association members, such as Andreessen Horowitz, Union Square Ventures and Ribbit Capital.” 

Neither the representatives of Diem nor Meta responded to queries in this regard.

Diem (formerly Libra) is a permissioned blockchain-based payment system proposed by Meta Platforms. In May last year, Diem revealed that it had revoked its application to the Swiss Financial Market Supervisory Authority and said it would pursue the US treasury’s permission to register as a cash services business.

On Tuesday, October 19, Facebook launched its long-awaited NOVI digital wallet offering support for Paxos stablecoin aka the Paxos Dollar (USDP). During the launch, David Marcus, Facebook’s head of the NOVI project said that the USDP has been the most trusted and widely supported stablecoin with three years of operations in the market.

As result, NOVI will be interoperable with other crypto wallets that support the Paxos stablecoin. However, one of the biggest missing features with NOVI is Facebook’s native cryptocurrency DIEM. Marcus also noted that the company is willing to launch DIEM after securing regulatory approval.

The NOVI wallet app, however, is currently available only to a few select customers in the U.S. and Guatemala. . In his Twitter post, David Marcus noted:

The U.S-Guatemala remittance corridor is an important one. In Guatemala, 56% of people lack access to financial services, despite nearly 100% having mobile phones. Money sent from family & friends abroad contributes more than 14% of GDP and 90% of those remittances come from the US.

NOVI Partners With Coinbase for Custody Services

Along with Paxos, Facebook has also partnered with crypto exchange Coinbase for the custody of the USDP stablecoins. The funds of NOVI users shall be held by a regulated custodian Coinbase Custody Trust Company. However, this development is still in the pilot stage of implementation. In its blog post, Coinbase noted:

Coinbase is supporting Novi via Coinbase Custody, which keeps user funds secure with our proprietary, fully segregated cold storage capability for managing private keys.

Facebook’s step into the crypto space has met with several roadblocks in the past. It has been a very tough time for Facebook dealing with regulators over the last few years. Its native cryptocurrency DIEM still faces major roadblocks. However, Facebook continues its developments in FinTech and the launch of the NOVI wallet could be the beginning of the new journey for the social media giant.